XRP Reaches 13-Month High Against Bitcoin with 35% Daily Increase – But Is Correction Inevitable?

XRP Reaches 13-Month High Against Bitcoin with 35% Daily Increase – But Is Correction Inevitable?

The price of XRP has risen sharply against Bitcoin (BTC) as optimism persists over a possible settlement between Ripple, the San Francisco-based blockchain payment company, and the US Securities and Exchange Commission (SEC).

Settlement Rumors Fueling XRP Price Surge

On September 23, the XRP/BTC pair rose to 0.00002877 – its best level in 13 months – from 0.00002132, a 35% price hike against Bitcoin in one day. Meanwhile, the same time frame saw XRP surge 42% against the US Dollar.

XRP/BTC and XRP/USD daily price chart. Source: TradingView

Significant price jumps in the XRP market started to appear after Ripple and the SEC made suggestions to seek a brief ruling with the court on September 12 regarding their ongoing legal battle over allegations that Ripple has committed securities fraud.

In other words, Ripple and the SEC agreed that the court should use the evidence available to reach a ruling on whether the blockchain company illegally raised funds by selling XRP by December 2022, thus avoiding prosecution.

The price of XRP has risen nearly 75% and 60% against Bitcoin and the dollar, respectively, since Ripple’s court filing, fueled by optimism that Ripple will win.

The purchase accelerated further after Ripple CEO Brad Garlinghouse suggested the same in his last interview with Fox Business on September 22.

Garlinghouse:

“People are realizing that the SEC has really overstepped their bounds and that they are not following a sincere devotion to the law in pursuit of a result. […] The SEC has strayed somewhat.”

Sharks and whales have been buying XRP since 2020

The price hike also comes amid the continued accumulation of XRP tokens by wealthy investors since May.

The percentage of entities holding between 1 million and 10 million XRP tokens – known as sharks and whales – as a whole rose to 6.35% on September 23, 2022, up from 5.43% on December 31, 2020, according to To the data from Santiment, which noted:

“The titles of active sharks and whales holding $1 million to $10 million XRP have been in an accretion pattern since late 2020.”

Active XRP sharks and whales addresses. Source: Santiment

Meanwhile, the given period also saw entities with more than 10 million XRP tokens reach an all-time low of 70.75% of their current supply.

Pain in the future?

It appears that traders were buying up this rumor in the run-up to Ripple’s decision vs. the Securities and Exchange Commission. But while it remains to be seen whether this turns into “selling news” afterwards, depending on the outcome of the ruling, XRP’s technical indicators point to a possible correction.

Notably, XRP has already become an overbought asset against bitcoin and the dollar.

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The Relative Strength Index (RSI) for XRP/BTC reached around 85 on September 23, well above the overbought threshold of 70 that usually precedes a strong price correction or consolidation.

XRP/BTC has already corrected about 10% from the 13-month high, as shown in the chart below. The pair is now testing 0.00002601 as short-term support, which, if broken on the downside, could make it test 0.00002079 as a primary downside target or a 20% drop from current levels by the end of the year.

XRP/BTC daily price chart. Source: TradingView

Meanwhile, XRP is eyeing a similar sharp correction against the dollar after crossing paths with multi-month downtrend line resistance, as shown below.

XRP/USD 3-Day Price Chart. Source: TradingView

An extended pullback from trendline resistance may test XRP to support the horizontal trendline in the near term as its next downside target. In other words, the XRP/USD pair could drop to $0.31 by the end of 2022, almost 40% lower than the September 23 price.

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